Rae v Joyce

• Jurisdiction: Ireland
• Judgment Date: 14 November 1892
• Docket Number: (1891. No. 13,087.)
• Date: 14 November 1892
• Court: Chancery Division (Ireland)

Appeal.

Before WALKER, C., SIR PETER O'BRIEN, C. J., and FITZ GIBBON and BARRY, L. JJ.

(1891. No. 13,087.)

RAE

and

JOYCE

Aylesford v. MorrisELR L. R. 8 Ch. 484.

Beynon v. CookELR L. R. 10 Ch. 391.

Webster v. CookELR L. R. 2 Ch. 542.

Miller v. CookELR L. R. 10 Eq. 641.

Fry v. Lane 40 Ch. Div. 312.

Bolingbroke v. O'RorkeELR 2 App. Cas. 814.

Bowes v. Heaps 3 Ves. & B. 117.

Barrett v. HartleyELR L. R. 2 Eq. 795.

Chesterfield v. JanssenENR 2 Ves. Sen. 125; 1 Wh. & Tud. L. C. (5th ed.), 592.

Miller v. CookELR L. R. 10 Eq. 641.

Tyler v. YatesELR L. R. 11 Eq. 265.

Bolingbroke v. O'RorkeELR 2 App. Cas. 814.

Middleton v. Brown 47 L. J. Ch. 411.

Fry v. Lane 40 Ch. Div. 323.

Webster v. CookELR L. R. 2 Ch. 542.

Tottenham v. Emmet 14 W. R. 3, 6.

Croft v. GrahamENR 2 De G. J. & S. 160.

Barrett v. HartleyELR L. R. 2 Eq. 794.

Bromley v. SmithENR 26 Beav. 644.

Salter v. Bradshaw Ibid. 161.

Foster v. RobertsENR 29 Beav. 467.

Jones v. RickettsENR 31 Beav. 130.

Miller v. CookELR L. R. 10 Eq. 646.

Aylesford v. MorrisELR L. R. 8 Ch. 484.

Bolingbroke v. O''RorkeELR 2 App. Cas. 814, at p. 822.

Thomson v. EastwoodELR 2 App. Cas. 215.

Bowes v. Heaps 3 Ves. & B. 117.

Beynon v. CookELR L. R. 10 Ch. 389.

Barnardiston v. LingoodENR 2 Atk. 135.

Bolingbroke v. O'RorkeELR 2 App. Cas. 835.

Evans v. LlewellinENR 1 Cox, 333.

Wiseman v. BeakeENR 2 Vern. 121.

Beynon v. CookELR L. R. 10 Ch. 391.

Chesterfield v. Janssen 2 Ves. 125.

Barrett v. HartleyELR L. R. 2 Eq. 789.

Fry v. Lane 40 Ch. Div. 312.

Unconscionable bargain Reversionary interest 31 & 32 Vict. c. 4, s. 1.

500 LAW REPORTS (IRELAND). [L. R. I. Appeal. RAE v. JOYCE (1). 1892. (1891. No. 13,087.) Nov. 1-4, 14. Unconscionable bargain-Reversionary interest-3r 4- 32 Yid. c. 4, s. 1. The plaintiff was entitled to a reversionary interest in a sum of 2100 invested on mortgages, subject to a life estate of a lady, aged sixty-three. The plaintiff was married in 1888, and, except the reversion, was without means. Her husband, who had been in the army, had no means, and was withÂÂout employment. In 1889 the plaintiff had mortgaged her reversion to N., for 400, at 7 per cent., and had borrowed two other sums of 50 and 52 108., for which she had given equitable charges on the fund. In January, 1890, the plaintiff and her husband were living in. an hotel in. Dublin. She was in delicate health, and was expecting her confinement in a few weeks. They had been trying to sell the reversion through M., a solicitor in Dublin. They had no money, and would be obliged to pay a week's hotel bill on the 16th January. On that day she executed a mortgage of the reversionary interest to the defendant, a Dublin money-lender, to secure 100 of an adÂÂvance, repayable in six months, at 60 per cent. There was a sum of 7 charged for costs, which also bore interest at 60 per cent. This mortgage was the result of several interviews between the plaintiff and her husband and the defendant. The deed was approved of by M. on behalf of the plaintiff, and acknowledged before a Commissioner :- Held (affirming the decision of the Vice-Chancellor), that the mortgage was, under the circumstances; a hard and unconscionable bargain, and should stand security for all sums advanced only with interest at 5 per cent. BY a settlement dated the 12th February, 1889, made between Anne Maria Downes, of the one part, and the said Anne Maria Downes and Herbert Edward Lockhart, of the other part, the said A. M. Downes settled a sum of 2050 on trust for herself for life, with remainder to the plaintiff. The 2050 had been invested by the settlor in three mortgages of 1600, 300, and 150, with interest on the same at 4 per cent., 5 per cent., and 5 per cent., respectively, secured by certain indentures dated respectively 14th January, 1875, 20th August, 1878, and 15th September, (1) Before WALKER, C., SIR PETER O'BRIEN, C.J., and trrz GIBBON and Mum, L.JJ. VOL. XXIX.] CHANCERY DIVISION. 501 1879, upon freehold and copyhold lands and premises known Appeal. as the Compton Mill estate, in the county of Bedford. A. M 1892. RAE Downes was an: aunt of the plaintiff, and was, at the date of v. the deed, 61 years of age. Theplaintiff was married in May, 1888, JOYCE. to Captain Vivian Rae, and there was no settlement executed on the occasion of her marriage. Captain. Rae had left the army, and had no private means ; and, except the reversionary interest in the 2050, Mrs. Rae was absolutely without means. By indenture dated the 13th March, 1889, Mrs. Rae had mortgaged the reverÂÂsion to Joseph Nathan, a London money-lender, to secure 400, with interest at 7 per cent. In addition, Captain and Mrs. Rae borrowed 50 from a Mr. Hammond, a London solicitor, and a sum of 52 10s. from John Wilson, a saddler in Dublin, to each of whom they had given an equitable charge on the reversionary interest in the fund. In the autumn of 1889, they instructed Mr. Miley, a Dublin solicitor, to sell the reversion for 800, but he had not succeeded in doing so. During the negotiation for this sale Mrs. Rae had written a letter to Miley on the 31st August, 1889, to the following effect :- " I return you the letter you kindly sent by Vivian for my perusal. I am quite content to take 700 at 7 per cent., or any sum that can be raised. Of course, as you know, the larger the sum the more practically useful it will be. " Cannot my husband act for me in this and all business matters ? as 1 am quite sure he would be much better able to understand things than I am. " One thing I would very much wish, i.e. the mortgage should be changed from Mr. Nathan, if possible, as I have an utter horror of Mr. Collins, etc. ! "Thanking you most heartily for all your kindness to us in this trouble." They owed Miley 45 for money lent, and also some costs. In October, 1889, Captain and Mrs. Rae came to Dublin, and went to live in lodgings in Lower Baggot-street, where they conÂÂtinued to live for about three months. On the 8th January, 1890, they went to live at the Hibernian Hotel in Dublin, being at the time absolutely without means, and Mrs. Rae expecting her conÂÂfinement within a few weeks, and she was in delicate health. Thomas Joyce, the defendant, was a money-lender, and the owner of the Express Bank in Stephen's-green, Dublin. Captain Rae went to Joyce on the 7th January, 1890, to try and effect a loan for 50, to be secured by a mortgage of the reversion, and by LAW REPORTS (IRELAND). [L. ,R. I. Joyce he was referred to McMinn, to approve of the security, for the loan. McMinn was a solicitor, who had an office on portion of the premises of the Express Bank, and he acted as solicitor for Joyce, under an agreement whereby Joyce paid him a salary, and Joyce received whatever was paid for fees. Between the 7th and the 14th January Captain Rae had seen Joyce several times, and one day he had called five or six times ; he had upon one of those days left a copy of the settlement of the 12th February, 1889, with McMinn. On the 14th January Mrs. Rae, along with Captain Rae, came to see Joyce about 4 o'clock in the afternoon, the loan having been practically agreed to, at that time, for 50, at 60 per cent. interest. The Raes proposed that the loan should only be for a short time, as they did not want to pay six months' interest. Joyce took from under the counter one of his prospectuses, and pointed to a line at the end, stating that the shortest period on mortgages was six months ; and he further stated that 50 for six months cost 15, besides whatever costs there were. It was then suggested that the loan should be increased to 100, which Joyce said he would consider. They then went into M`Minn's office, and Mllinn stated that the deed must be apÂÂproved of by an independent solicitor, and the plaintiff and her husband stated that Miley would approve of it on their behalf. The Raes were also told that it would be necessary to serve notice of the mortgage on the trustees of the settlement of the 12th FebÂÂruary, 1889. Captain Rae stated that notice could not be served on Miss Downes, because it would ruin them if she knew they were borrowing money at such a high rate of interest. On being told that service of notice on one trustee would be sufficient, they said Miley was about being appointed a trustee of the deed instead of Lockhart, and they could serve notice on him. A telegram was then sent to a Mr. Hammond, a solicitor in London, of the firm of Kime and Hammond, to ask if he had the deed of settlement, and would, he undertake to endorse a memorandum of further charge on it; and the following day an answer was received from HamÂÂmond that he had the deed and he would endorse the memorandum of further charge. McMinn, on the 14th Januar*, gave Rae the draft of the' Vol.. XXIX.] CHANCERY DIVISION. 503, mortgage. The mortgage was made between Mrs. Rae of the Appeal. first part, Captain Rae of the second part, and Thomas Joyce of 1892. RAs the third part, and after reciting that Mrs. Rae was entitled to the v. trust funds in the deed of the 12th February, 1889, and that she JOYCE. had applied to Joyce for the loan of 100 2s. for six months, which the mortgagee had agreed to advance upon having the same with interest at the rate thereafter mentioned, and the sum of 7, being the sum agreed upon as and for the costs of the deed, with interest at the like rate, and future advances and interest secured in manner thereafter appearing, and reciting that Captain and Mrs. Rae had delivered to Joyce a promissory note for 100 2s. at six months' date, Mrs. Rae covenanted to pay to the mortgagee the sums of 100 2s., and 7 on the 19th July, 1890, with interest therefor, respectively, at the rate of 60 per cent. per annum, or so much as should remain unpaid at the like rate, and would also pay to the mortgagee all future advances, at the same interest, and Mrs. Rae, as beneficial owner, assigned to Joyce the three mortgage debts of 1600, 300, and 150, and also the freehold and...